WSJ: "The CEOs Who Didn't Deserve the Boot"

Nasdaq recently released a blueprint to revitalize the capital markets in the United States. One of the pillars of the plan is the focus on long-termism.

Nasdaq believes that one of the greatest threats to modern markets is the rising pressure to think and plan around the trading day and quarterly report, rather than to invest in sustainable long-term growth and profits. The rise of short-termism harms companies, investors, and the broader U.S. economy.

"Soaring CEO compensation can make it hard to feel sorry for the boss, especially when eye-popping pay packets are not matched by performance. While Uber founder Travis Kalanick’s questionable conduct got him ousted, anxious corporate boards facing short-term investor pressures recently have sent unprecedented numbers of virtuous and transformational CEOs packing well before their times.

"The Wall Street Journal" reported last week that 13 companies with market capitalizations greater than $40 billion replaced their CEOs during the first five months of 2017. This list includes Ford, General Electric, U.S. Steel, Buffalo Wild Wings, CSX, AIG, Yahoo, and Arconic. Many fell victim to a short-term mindset fueled by activist hedge funds. Meantime, some top-performing CEOs—such as Michael Dell, Whole Foods founder John Mackey, and Panera Bread’s Ron Shaich—have led their companies away from short-term financial markets to focus on long-term business investments.

Today’s corporate bosses aren’t the robber barons or country-club networkers of yesteryear. Modern CEOs are generally smart, diligent, and committed to their jobs. They can easily travel hundreds of thousands of miles a year. Eighty-hour weeks are the norm. Many report that the professional demands are so intense that they have little time for family or personal friendships.

Mark Fields worked for the Ford Motor Co. for 28 years, rising to become its CEO in 2014. During his three-year tenure at the helm of America’s second-largest auto maker, the company was profitable. Ford’s recent success was due in part to the popularity of the redesigned F-150 truck, which became America’s best-selling vehicle on Mr. Fields’s watch, and to other major product relaunches, including the legendary Mustang. In 2015, the company enjoyed the best earnings year in its 113-year history."

Learn more about Nasdaq's blueprint and activities to revitalize the U.S. capital markets to create a vibrant ecosystem for delivering enhanced capital formation opportunities, a more inviting environment for growth and innovation, and accelerated job formation and wealth creation.